The Firm Billing Policy

The Firm Billing Policy flows directly from the relationship the Firm wants with its Clients (see “The Firm’s Expectations Of Its Clients”) and from the Firm’s goals for its relationship with each Client (see “The Firm’s Goals In Each Client Relationship”).

The following are some of the general principles that make up the Firm Billing Policy:

No Client will be asked to pay any fee that does not fit the Client’s budget.

No Client will be asked to pay any fee that does not fit the Client’s sense of the value of the services provided by the Firm.

No Client will receive a final invoice until the Client has received a draft of the invoice and has approved it.

The Firm does not bill based on time.

The Firm does not bill for routine and non-substantial disbursements. For material disbursements, the Firm will request the Client to pay the expense directly or will request the third party to bill the Client directly. Examples would include filing fees, court reporters, title company expenses, certified copies of documents, expert witnesses, Special Counsel fees, major photocopy projects, airplane travel, hotel accommodations, etc. Some materials disbursements cannot be paid directly by the Client and in those instances, the Firm will bill the Client for the disbursements. Examples would include extended long distance conference calls, airplane travel, cab fares, meals while traveling, hotel accommodations, etc.

The form of the Firm’s bills are general narratives of the work done during the given time period. The Firm does not do diary billings because it does not bill based on time. The Firm will first provide the Client with a draft of the invoice. The Client can see that:

The Amount Due is not filled in;

The Client controls what it pays;

The bill is expressly subject to the Client’s budget and the Client’s sense of the value of the services;

In the middle of the bill after the “AGREED VALUE OF SERVICES:?”, the Firm suggests a value of services for the billing period but leaves the decision to the Client; and

The Amount Due has a question mark next to it.

The Firm asks each Client to review the draft of the invoice and let the Firm know what amount the Client wants filled in as the Amount Due. The Firm asks each Client to do that within several days of receipt.

The Firm asks each Client to pay the finalized invoice within 5 days of receipt.

For non-retainer billing relationships, there are two types of billing methods the Firm follows:

A project fee. For a number of engagements or matters, including litigation, the Firm is able to evaluate the effort needed and the value of what is being asked to be done and can give the Client a quote for the entire engagement or for a period of time during the engagement (e.g. monthly, quarterly, etc.) “up front.” This method allows the Client to set a project fee that fits the Client’s budget and the Client’s sense of the value of the services. That project fee can take a variety of forms. Those forms include some of the following:

One amount for the entire engagement or matter;

Set monthly amounts paid during the engagement or matter; or

Fixed amounts for each similar item with which the Firm is asked to help. For example, some Clients have repetitive types of documents they need reviewed or transactions they need negotiated and closed. The documents can be leases, license agreements, distributor agreements, etc. The transactions can be leases, franchises, acquisitions, dispositions, financings, private placements, joint ventures, etc. In many instances, the Firm and the Client simply strike an amount that is the same for each agreement or transaction.

The billing method described in Paragraph 6 above. The Firm, at the end of the month, will send the Client a draft of the invoice and the Client can then determine what amount it wants filled in for the Amount Due.

As noted above, the Firm does have a number of retainer relationships. See “The Firm’s Policy On Retainers.”

The Firm, in selected situations, has and will agree to provide professional services in certain transactions in return for an equity interest in the asset or the investment being purchased.

The Firm works very hard to avoid the Client being placed in a billing situation which could be described as, “heads, the Firm wins and tails, the Client loses.” The Firm works to make sure there is a certain degree of symmetry in the economic result for both the Client and the Firm. In transaction engagements, the Firm works at making the bill proportionate to the engagement, to the size of the transaction, and to the economic benefit to the Client. The Firm’s preferred relationship with its Clients is a “win, win” relationship, i.e., the Client wins and the Firm wins.

There have been and will continue to be issues that arise for which the Firm’s best advice is that Special Counsel be retained for the issue. In those instances, the Firm’s commitment is to volunteer its time to serve the role of “in house” counsel for the Client in managing Special Counsel and the issue, the tactics and strategies, the resolution of the matter, the decisions to be made, minimizing the intrusion of the issue on the time and attention the management team spends on operations, quality control, the paperwork, and the budget for Special Counsel. Fees for professional services provided by Special Counsel will be forwarded to the Client for payment directly.